An interview with Chris Wong, NZ Post’s GM of Business Marketing
The five key trends and opportunities Wong thinks will be crucial to online retail success in 2021 are:
- Continued local sentiment. 70% of online spend was domestic in 2020 and this sentiment is likely to continue. With ongoing restrictions to international travel, the ‘see and buy local’ preference has no reason to recede. And as the global situation worsens, we could also see an increasing number of international consumers attracted to our safe, sustainable, natural and innovative products. But Wong warns that local retailers shouldn’t take their preferred status as a given. “The big global players, like Amazon and Alibaba, will keep investing in new platforms, technology and experiences, continually raising the bar for local players to compete.”
- Adapting to a more competitive online world. In 2020, we saw Office Max take their offering fully online. The Warehouse realigned resources to online and Countdown built a dedicated eShop. Wong thinks we’ll see more of this ‘online first thinking’ as traditional Kiwi retailers, adapt their business model for the growing importance of online to their business. Existing online retailers will continue to invest in online promotions to drive sales and this will continue to push the cost of digital advertising up. The growth of social commerce, facilitated by big players like Facebook and Shopify, lift competition for online attention and sales to yet another level. Wong points out that, “the online world will become even more competitive, requiring businesses to work even harder to develop their brand and to ensure their advertising spend cuts through the clutter.”
- Fulfilment as a competitive advantage. Retailers really saw the importance of delivery in 2020. Many will be looking to invest further to ramp up their capacity and to find ways to deliver quicker, safer and more sustainably. Now more than ever, it’s important to give customers choice and control on how, when and where they receive their parcels. This will see options like Click and Collect and Out of Home collection (like collection agents and lockers) solutions accelerate across many retail sectors. Wong points out that NZ Post understand that the delivery experience is critical to happy customers and that’s why they are working with retailers to create better delivery experiences like same day, evening and weekend delivery options.
- Enhanced experience expectations. Consumers are no longer seeing it as online vs instore but a seamless experience that spans both. Wong says, “Cross channel retailers need to consider how to create more personal and human experiences that add value for shoppers however they engage.” He points to examples of personalisation and virtual applications, like augmented reality, to help replicate the instore experience at home. In other situations, the ease and convenience of the online purchase process is offered to customers in an in store setting.
- The retention focus. Many retailers experienced significant increases in customer numbers over the last year. As the online world gets more competitive, the value of retaining and growing these new customers increases. The challenge for retailers is to think differently about who their customers are and what’s important to them. This new, first time, online shoppers, may be older, live rural and have different preferences, behaviours and needs. Retailers can’t assume that they are similar to the customers they had before. Wong’s advice is to “engage with your customers, understand what’s important to them and keep adapting your offering as their needs and expectations change.”
Chris Wong feels excited about the year ahead and what it has in store for retailers. “Bring it on” he says “At NZ Post we are well-prepared for 2021. Whatever the year holds, we are ready to make the most of the huge opportunity that online shopping offers shoppers and the retailers we work with.”
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